Appendix: Update on progress with our previous recommendations
Results of the 2022 school audits.
We provide an update on the Ministry of Education’s progress with the recommendations in our report Results of the 2021 school audits.
2021 recommendations
Cyclical maintenance plans
| Recommendation | We recommend that the Ministry of Education ensure that schools are complying with their property planning requirements by having up-to-date cyclical maintenance plans. This includes reviewing those plans to assess whether they are reasonable and consistent with schools’ asset condition assessments and planned capital works. |
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| The Ministry of Education’s current progress against recommendations | From 1 July 2023, property consultants at the Ministry of Education have been instructed to use the updated cyclical maintenance calculator as part of the 10YPP preparations process. The Ministry has been following up with schools and property consultants where no cyclical maintenance plan has been included in their 10YPP documentation and completing updates as required to address this issue. The Ministry acknowledges that this part of the financial statements has a significant level of judgement and estimation involved and the Ministry continues to improve support available to schools and kura. |
| Our comment | We have repeated this recommendation. |
School budgets
| Recommendation | We recommend that the Ministry of Education engage with the schools we have identified as not preparing full budgets and provide them with the necessary support to ensure that their budgets for the next school year are complete. |
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| The Ministry of Education’s current progress against recommendations | The Ministry has been engaging with schools both on request and targeting school and kura where required during the 2023 budget season, supporting schools in the preparation of their 2024 budgets. The School Financial Advice team has also developed a set of budgeting support tools that can be used to support discussions with schools about the importance and need to prepare “full” budgets. |
| Our comment | We have repeated this recommendation. |
Kiwi Park model financial statements
| Recommendation | We recommend that the Ministry of Education continue to simplify the level of financial reporting required in the Kiwi Park model financial statements – in particular, reconsidering what information the Ministry of Education specifically requires in addition to what is required by financial reporting standards. |
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| The Ministry of Education’s current progress against recommendations | The Ministry has continued to refine the Kiwipark model for the 2023 year, making further improvements to make the accounts simpler and easier to prepare. The Ministry requires additional disclosures only where there is a need for them as the result of public interest. We welcome the approach to continue to remove any disclosure that is not expressly required by the accounting standards. The Ministry will continue to work through what other options are available currently, as well as in the medium to long term, to ensure that the financial reporting requirements are not unnecessarily detailed, while providing enough information to ensure public accountability. |
| Our comment | We have not repeated this recommendation, however we will continue to monitor progress. |
2020 recommendations that are still relevant
School payroll processes
| Recommendation | We recommend that the Ministry of Education make sure that changes to school payroll processes do not adversely affect the schools’ control environment by working collaboratively with Education Payroll Limited. This includes making sure that controls within schools help prevent fraud and error and ensure that all transactions are approved within delegations. |
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| The Ministry of Education’s current progress against recommendations | There have been no significant changes to the payroll process during the current year. The Ministry has been meeting with Education Payroll Limited to discuss potential audit related issues and internal control challenges when known. The Ministry is unable to force an internal control upon a school or kura during its day-to-day operations as this is the school’s responsibility. The Ministry has ensured that appropriate guidance and information is available to assist schools in implementing a strong internal control environment. |
| Our comment | As explained in paragraphs 3.11 and 3.12, it is our understanding that not all necessary reports are in place to allow schools to review all payroll transactions. This is a weakness in the control environment. We have recommended that the Ministry of Education follow up with Education Payroll Limited to ensure that additional functions are developed and communicated to schools as indicated in the current guidance on school payroll processes and controls, so that schools are able to checked and approve all transactions. |